2018 (12) TMI 524

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....rch and seizure operation conducted u/s 132 of the Act on 13.12.2012 in the residential and business premises of various persons belonging to Maanheruka Group including the assessee. In some cases belonging to the group, survey operation u/s 133A of the Act was also conducted on the same date and / or subsequent dates. The assessee company is one of the group companies of 'Maanheruka Group' of cases. Consequent to the search, notice u/s 153A of the Act was issued on 7.10.2013 and served on the assessee on 8.10.2013. For the year under consideration, the assessee filed a letter dated 19.11.2013 stating that the original return filed u/s 139(1) of the Act on 30.9.2009 declaring taxable income of Rs. 15,32,490/- may be treated as a return in response to notice issued u/s 153A of the Act. The assessee stated that the time limit for issuance of notice u/s 143(3) of the Act for the Asst Year 2009-10 in respect of the original return filed on 30.9.2009 had expired on 30.9.2010 and hence as on the date of search, that year (i.e Asst Year 2009-10) would fall under the category of unabated assessment and hence the income assessed originally thereon, which is same as the returned income, coul....

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....ve considered the findings of the AO in the assessment order, different case laws brought on record and appeal orders passed by my predecessors on this legal issue. I find from the assessment order that during that search and seizure operations conducted u/s 132 of the I.T.Act, 1961, incriminating documents / papers were not seized. At least, additions made by the AO in the assessment order passed u/s 153A / 143(3) are not based on any incriminating documents / papers seized during that search operation. It would also not be out of context to mention here that in this case, on the date of search, no assessment for this year was pending. Therefore, keeping in view the ratio decided by the Jurisdictional Bench of Kolkata Tribunal in cases referred above and the ratio decided by the Hon'ble Calcutta High Court in the case of Veer Prabhu Marketing Ltd (supra) in the light of CBDT's decision of not filing SLP in this case in the Supreme Court and keeping in view the Apex Court's decision to dismiss SLP on similar issue in the case of Pr. CIT vs. Kurele Paper Mills Pvt. Ltd. : SLP (C) No. 34554 of 2015 dated 07.12.2015, I am of this view that in order to maintain judicial continuity on t....

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.... his possession, has reason to believe that - (a) where a person fails to produce the books of accounts and other documents in response to notice u/s 142(1) or summons issued u/s 131(1) of the Act ; or (b) where a person fails to comply with the requirements of summons issued u/s 131(1) of the Act ; or (c ) where a person is in possession of any money, bullion, jewellery or other valuable article or thing and such assets represents either wholly or partly income or property which has not been , or would not be, disclosed for the purposes of the Act (hereinafter referred to as the undisclosed income or property) ; then the officer , so authorized could conduct a search and proceed as per the requirements laid down in the said section. He argued that the aforesaid three primary conditions for invoking search proceedings cannot be given a go by while framing section 153A assessments and the instant case falls under section 132(1)(c ) of the Act. The provisions of section 153A of the Act use the expression 'assess or reassess total income' and hence the search assessment could be framed u/s 153A of the Act irrespective of any incriminating materials. 9. We have heard the rival sub....

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....pect of each assessment year falling within such six assessment years:" 9.1. We find that the Co-ordinate Bench of Delhi Tribunal in the case of Dy. CIT v. Aggarwal Entertainment (P.) Ltd reported in [2016] 72 taxmann.com 340 (Delhi - Trib.) had addressed this aspect. The relevant headnotes is reproduced below:- "Section 153A, read with section 143, of the Income-tax Act, 1961-Search and seizure - Assessment in case of (in case of section 143(1) assessment)-Assessment year 2004-05- Whether assessment in respect of which return has been processed under section 143(1), cannot be regarded as pending for purpose of section 153A as Assessing Officer is not required to do anything further about such a return and, thus, said assessment cannot be reopened in exercise of power of section 153AHeld yes (Paras 10 and 12) (In favour of assessee)." 9.2. We find that the Co-ordinate Bench of this tribunal in the case of ACIT vs Kanchan Oil Industries Ltd in ITA No. 725/Kol/2011 dated 9.12.2015 reported in 2016-TIOL- 167-ITAT-KOL had explained the aforesaid provisions as below:- "6.4 In our opinion, the scheme of assessment proceedings should be understood in the following manner pursuant to....

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.... as under:- '37. On a conspectus of section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: (i) Once a search takes place under section 132 of the Act, notice under section 153A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. (ii) Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the ld AOs as a fresh exercise. (iii) The ld AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The ld AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". (iv) Although Section 153A does not say tha....

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.... in the case of E.N.Gopakumar vs CIT reported in (2016) 75 taxmann.com 215 (Kerala) in support of his contentions. We find that the decision of Hon'ble Delhi High Court in the case of CIT vs Kabul Chawla reported in (2016) 380 ITR 573 (Del) had duly considered the decisions of CIT vs Anil Kumar Bhatia reported in (2013) 352 ITR 493 (Del) ; CIT vs Chetan Das Lachman Das reported in (2012) 211 Taxman 61 (Del HC) ; Madugula Venu vs DIT reported in (2013) 215 Taxman 298 (Del HC) ; Canara Housing Development Co. vs DCIT reported in (2014) 49 taxmann.com 98 (Kar HC) ; Filatex India Ltd vs CIT reported in (2014) 229 Taxman 555 (Del HC) ; Jai Steel (India) vs ACIT reported in (2013) 219 Taxman 223 (Del HC) ; CIT vs Murli Agro Products Ltd reported in (2014) 49 taxmann.com 172 (Bom HC) ; CIT vs Continental Warehousing Corporation (Nhava Sheva) Ltd reported in (2015) 374 ITR 645 (Bom HC) and All Cargo Global Logistics Ltd vs DCIT reported in (2012) 137 ITD 287 (Mum ITAT) (SB). We also find that against the decision of the Hon'ble Delhi High Court in 380 ITR 573 (Del) , the revenue preferred Special Leave Petition before the Hon'ble Supreme Court and the same was dismissed by the apex court ....